JAKARTA (Reuters) – Indonesia’s authorities is in early conversations with electric cars maker Tesla Inc about a opportunity financial commitment in the Southeast Asia state, a significant producer of nickel, an formal reported.

Indonesia is eager to create a entire provide chain for nickel at property, specially for extracting battery chemicals, producing batteries and sooner or later constructing EVs.

It has stopped exports of unprocessed nickel ore to assistance investment in its domestic industries.

Ayodhia Kalake, a senior formal at the Coordinating Ministry for Maritime and Investment decision, reported Tesla had reached out to the authorities informally about a feasible venture, but he did not specify what it experienced in brain.

“It was however an early dialogue and was not thorough nonetheless,” Ayodhia explained in a assertion on Monday.

“We need even more discussion with Tesla,” he claimed, introducing that Indonesia has a number of incentives for financial commitment in EVs.

Tesla did not quickly respond to a Reuters e mail seeking affirmation.

Indonesia past month claimed it experienced secured a deal to establish a lithium battery plant in the nation with South Korean LG Chem Ltd <051910.KS> and China’s Contemporary Amperex Technological innovation Ltd (CATL) <300750.SZ>.

Tesla is searching to ramp up manufacturing of trucks and photo voltaic jobs and its manager Elon Musk earlier this year urged miners to create additional nickel and available “big”, extensive-expression contracts if mined “proficiently and in an environmentally sensitive way”.

Even though EVs are envisioned to support lessen global carbon emission, activists are involved that generation of EV pieces and elevated mining might damage the environment.

An Indonesian nickel smelting project being designed by China’s Tsingshan Group and associates to develop battery-quality substances withdrew a ask for to dispose of squander in the ocean, a authorities official said on Friday.

(Reporting by Bernadette Christina Munthe Crafting by Fransiska Nangoy Enhancing by Martin Petty)